Amazon Shares Up 25% on $100 B Anthropic Deal and AI Chip Momentum
Amazon shares jumped 25% in the last month after securing a $100 billion, 10-year Anthropic commitment and a deal with Meta for AWS Graviton5 chips. Its custom chip unit runs over $20 billion annualized, yet a 37x P/E and $200 billion 2026 capex target pose valuation concerns.
1. Share Performance and AI Wins
Amazon shares rallied over 25% in the past month following announcements of large-scale AI infrastructure partnerships. The momentum reflects investor optimism around AWS’s expanding role in supplying advanced processors for leading AI models.
2. Anthropic and Meta Agreements
Amazon secured a 10-year, $100 billion commitment from Anthropic to use AWS services and struck a deal with Meta to deploy its next-generation Graviton5 chips. These agreements underscore AWS’s competitive position in the cloud AI market.
3. Custom Chip Unit Expansion
The custom chip division now runs at a $20 billion annual revenue run rate, driven by design wins across AWS AI instances. Rapid triple-digit growth in chip sales is contributing meaningfully to the overall cloud segment’s expansion.
4. Valuation Metrics and Capex Plan
Despite strong top-line trends, Amazon trades at a 37x forward P/E ratio and has outlined up to $200 billion in capital expenditures for 2026. Such heavy investment and lofty multiples raise questions over near-term returns and potential margin pressure.